The quest for a better Binary Options strategy never ends but I guess it all comes down to what suits each trader’s personality. Even the best strategy can Suck if you don’t feel comfortable with it and what works for someone can be totally useless for another trader. That’s why we try to bring you all sorts of strategies, some easy to use and some more complex and recommended for advanced traders. Today I’m going to review and explain for you a strategy developed for Binary Options right from the start so we don’t need to adapt it.
How does the 3 Bars HIGH or LOW Strategy Work?
One of the main advantages is the simplicity of this strategy so I am sure everybody will find it easy to use right from the start. The only required indicator is… get ready *drum rolls* … Indestructible TrendWinner (download at the bottom of the page). I know, I know, I started laughing too when I first read its name. It sounds like something used by all those “secret” strategies sold for $99.99 all over the internet. But let’s cut it some slack and take a closer look: this indicator shows us the overall trend according to the strategy by changing colors from red to green and vice versa. So when the Indestructible TrendWinner is Green, we only look for Calls and when it’s Red we only look for Puts. As an additional confirmation, the author uses ADX and only trades when it is above the 19 level. I don’t know how he came up with that exact level and I am not sure ADX is really needed. Anyway, he considers the ADX filter as “optional” so feel free to experiment with it. I don’t find it necessary for this strategy.
Good, we have a sense of direction and now we must find the exact entry. The setup is two consecutive one hour candles/bars the same color as the… Indestructible TrendWinner (I can’t get enough of that name) and the exact entry is the beginning of the third bar/candle. The expiry is 60 minutes but the strategy can be used on higher time frames also; if you use 4 hour candles for your entry, the expiry will be 4 hours too. The author also mentions the two bars “must be in slope” so we need to see price moving up strongly for a Call and vice versa for a Put. Do not enter if price is just stalling or moving in a range. In fact, this is one of the first things he mentions: the strategy works only in a trend. Here is an example:
Notice the white rectangles: they contain three Green candles and all Calls taken at the beginning of the third candle would have been successful according to the strategy. So let’s recap:
- Indestructible TrendWinner Green
- Two consecutive Green bars/candles in a rising slope
- Enter a Call at the beginning of the third candle
- Indestructible TrendWinner Red
- Two consecutive Red bars/candles in a descending slope
- Enter a Put at the beginning of the third candle
Why does “3 bars High or Low” Strategy Suck?
Right from the start the author warns us that it only works in a trend so if you try to use it in a range you will get a lot more Out of the Money trades than in a trend. But this drawdown is easily avoided: just follow the strategy and stay away from ranging markets. Also, I haven’t decided yet if the name “Indestructible TrendWinner” Sucks or not, but I’ll let you know when I do J
Why the “3 bars High or Low” Strategy doesn’t Suck?
This strategy is easy to use and in fact I think that even a complete newbie can trade it if they can identify colors. It doesn’t get easier than this: Red or Green on the indicator – same color on two consecutive candles – Trade! The best part is that from what I saw, the accuracy is pretty high. You will get losing trades, don’t get me wrong, but overall I saw more winners.
Wrapping it up – Pick it up and Trade It
If we put aside the name of the trend indicator, this strategy looks good on paper because it helps you trade with momentum in the direction of the trend. Also the fact that it uses one hour or higher charts gives it more reliability because some of the market noise is eliminated. I believe it’s a great way for a newbie to get used to trading Binaries without having to learn complicated stuff like Divergences or economic and financial indicators. Anyway, it needs testing on a Demo account or even better, on the CommuniTraders platform. Then you can decide if it Sucks or not. Happy trading and Thanks to the original author on forexstrategiesresources.com.
Download the Indestructible TrendWinner for the 3 Bars High or Low Strategy Here!
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